Indian Railways to revise passenger fares from July 1; check new price structure

New Delhi: For the first time in five years, Indian Railways is set to revise passenger fares starting July 1.

The proposed fare hike, though marginal, is aimed at boosting the national transporter’s revenue without imposing a significant burden on passengers.

A formal notification is expected to be issued in the coming days, subject to final approval by the government.

According to official sources, the revision will apply mainly to AC and long-distance non-AC travel, while suburban fares and short-distance second-class journeys will remain unchanged.

Minor hike in per-kilometre rates

As per the proposal, air-conditioned (AC) class fares are expected to rise by 2 paise per kilometre, and non-AC mail and express train fares by 1 paisa per kilometre. For instance, a one-way AC journey from Delhi to Mumbai or Kolkata may cost Rs 25 to Rs 30 more.

General second-class fares for distances exceeding 500 kilometres will increase by only 0.5 paisa per kilometre, equating to a hike of just Rs 1 for a 700 km journey.

Suburban train tickets, monthly season passes, and second-class travel under 500 km will remain unaffected, offering relief to lakhs of daily commuters who depend on these services.

Revenue gain of Rs 700 Cr projected

Railway authorities estimate that the fare revision will fetch approximately Rs 700 crore in additional revenue during the remaining three quarters of the current financial year. For 2025–26, the Railways has projected passenger revenue of Rs 92,800 crore, as per the Union Budget estimates.

A senior official noted that the proposed revision is nearly 50 per cent lower than the last fare hike in 2020, which saw AC fares go up by 4 paise per kilometre and non-AC fares by 2 paise per kilometre.

“This modest increase is not expected to significantly affect passenger budgets,” the official said.

Panel flags cost recovery gap

The proposal follows recommendations made by the Parliamentary Standing Committee on Railways, which urged the ministry to review passenger fares, especially for AC classes, to reflect the actual cost of operations.

According to the committee’s findings, suburban services recover only 30 percent of their costs, non-AC travel recovers about 39 percent, and AC services generate a minimal surplus of 3.5 percent. The panel had called for the rationalization of fares to address the growing operational deficit.

Political sensitivity ahead of polls

The proposed hike comes ahead of the upcoming Bihar assembly elections. While the move is seen as economically justified, a section of the government has expressed caution over its timing due to possible political repercussions.

Nevertheless, by excluding suburban and second-class short-distance travel from the revision, the Railways hopes to balance fiscal concerns with commuter interests. The final decision is expected in the next few days.